This Advisory Opinion concerns the following issue as formulated from facts and/or circumstances furnished by a requestor. The Commission approved this opinion on March 2, 2001, basing its approval solely on the facts and circumstances stated herein.

May an employee of a natural gas district serve as an alderman of a town that participated in the creation of the district and that receives significant funding from the district?

State law restricts the Mississippi Ethics Commission to interpreting and issuing opinions on Sections 25-4-101 through 25-4-119, 1972 Mississippi Code Annotated and Article IV, Section 109, Mississippi Constitution of 1890. Therefore, this opinion does not address the Mississippi laws outside the Commission's jurisdiction nor the governmental entity's internal rules and regulations.

The pertinent conflict of interest laws to be considered here are:

Constitutional Section 109 states:

"No public officer or member of the legislature shall be interested, directly or indirectly, in any contract with the state, or any district, county, city, or town thereof, authorized by any law passed or order made by any board of which he may be or may have been a member, during the term for which he shall have been chosen, or within one year after the expiration of such term."

Code Section 25-4-101 states:

"The legislature declares that elective and public office and employment is a public trust and any effort to realize personal gain through official conduct, other than as provided by law, or as a natural consequence of the employment or position, is a violation of that trust. Therefore, public servants shall endeavor to pursue a course of conduct which will not raise suspicion among the public that they are likely to be engaged in acts that are in violation of this trust and which will not reflect unfavorably upon the state and local governments."

Code Section 25-4-103(f)(i)(ii), (g)(ii)(v), (h), (l) and (p)(i)(ii)(iii) states:

"(f) 'Contract' means:

(i) Any agreement to which the government is a party; or

(ii) Any agreement on behalf of the government which involves the payment of public funds.

(g) 'Governmental' means the state and all political entities thereof, both collectively and separately, including but not limited to:

(ii) Municipalities; and

(v) Any department, agency, board, commission, institution, instrumentality, or legislative or administrative body of the state, counties or municipalities created by statute, ordinance or executive order including all units that expend public funds.

(h) 'Governmental entity' means the state, a county, a municipality or any other separate political subdivision authorized by law to exercise a part of the sovereign power of the state.

(l) 'Pecuniary benefit' means benefit in the form of money, property, commercial interests or anything else the primary significance of which is economic gain. Expenses associated with social occasions afforded public servants shall not be deemed a pecuniary benefit.

(p) 'Public servant' means:

(i) Any elected or appointed official of the government;

(ii) Any officer, director, commissioner, supervisor, chief, head, agent or employee of the government or any agency thereof, or of any public entity created by or under the laws of the State of Mississippi or created by an agency or governmental entity thereof, any of which is funded by public funds or which expends, authorizes or recommends the use of public funds; or

(iii) Any individual who receives a salary, per diem or expenses paid in whole or in part out of funds authorized to be expended by the government."

Code Section 25-4-105(1) and (2) states:

"(1) No public servant shall use his official position to obtain pecuniary benefit for himself other than that compensation provided for by law, or to obtain pecuniary benefit for any relative or any business with which he is associated.

(2) No public servant shall be interested, directly or indirectly, during the term for which he shall have been chosen, or within one (1) year after the expiration of such term, in any contract with the state, or any district, county, city or town thereof, authorized by any law passed or order made by any board of which he may be or may have been a member."

Pertinent facts and circumstances provided by the requestor, absent identifying data, are set forth as follows and considered a part of this opinion.

I am writing in regard to a written request from an Alderman for an opinion as to him qualifying to run as an alderman for the Town.

This individual is a valued alderman for the Town and is elected by the citizens of this Town. He has always obtained an opinion before qualifying for this office and attached is one from the Attorney General's Office.

As Mayor of the Town and as one of the five (5) managing directors of the Natural Gas District, I am requesting that your Commission take a closer look at this situation.

The Natural Gas District is a political subdivision of the State of Mississippi, set up in 1950. The District is managed, not owned, by the three mayors of the municipalities, with two (2) elected representatives of two counties.

The Alderman is employed as a serviceman in the District of the Town. The Town has no controlling interest in the Gas District Office whatsoever.

One of the Representatives on the Gas Board is from one of the counties and he was employed as a serviceman for another utility company but is now District Supervisor of one of the municipal offices for that utility company. I have a problem understanding these opinions, as they are both utility companies.

I would like to have an opinion from you before the deadline of March 1, 2001 concerning the Alderman.

In addition to the requestor's facts, the Commission's staff has obtained the following general and specific supplemental information.

The general supplemental information is as follows. The Natural Gas District was established by ordinances adopted by the Town and two other municipalities in 1950. Also in 1950, the Mississippi Legislature by a Local and Private Law created and declared the Natural Gas District to be a valid political subdivision of the State of Mississippi. The Local and Private Law validated the organization of the Natural Gas District as originally adopted in the municipalities' ordinances which called for the Gas District's board to consist of the mayors of the three municipalities. In 1991, the Mississippi Legislature amended §77-15-1, 1972 MCA (amended), to add two members to the Natural Gas District's board. The two additional board members are residents of the two counties the gas system serves. The two county board members are elected by gas system users residing outside of the three municipalities. The Local and Private Law that creates the Natural Gas District provides that the District shall continue to exist as a political subdivision and does not provide for its dissolution.

The specific supplemental information is as follows and was provided by Town and District personnel. The Natural Gas District has unilaterally provided funding to the Town, and the other two municipalities, since 1969. By resolution, the Natural Gas District's board of directors authorized the distribution of a percentage of its gross revenues to the three municipalities on a monthly basis. The Gas District during its 1999-2000 fiscal year funded the Town in an amount totaling approximately $47,700.00. The Gas District during the first six months of the 2000-2001 fiscal year funded the Town in an amount totaling approximately $12,800.00. The Natural Gas District has reduced the percentage of gross revenues that it pays the Town during its current fiscal year due to increase revenues brought on by higher gas prices and has also informed the Town that it is changing the formula to a percentage of its net revenues effective July 2001. There are no written contracts existing between the Town and the Natural Gas District. However, there is an implied agreement whereby the Town is allowed by the Natural Gas District to occupy a portion of the District's building for use as a city hall.

The facts and circumstances that are controlling in this request are the identical controlling facts and circumstances addressed in the attached Advisory Opinion No. 01-019-E.

Therefore, the Commission formally adopts Advisory Opinion No. 01-019-E in its entirety as its response to this request and by attachment incorporates it into this opinion.
 

Ronald E. Crowe

Executive Director